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CONTENTS
Page
Background .......................... 4
Discussion ......................... 17
I. Introduction ...................... 17
A. Overview of Section 7430 ............. 17
B. Tax Court’s Authority To Award Appellate
Fees Under Section 7430 .............. 18
C. The Other Side of the Coin: Inapplicability
of Section 6673(a)(2) and the Bad
Faith Exception .................. 22
II. Entitlement to Relief Under Section 7430 ........ 25
A. Respondent’s Position ............... 25
B. Paid or Incurred Requirement ........... 25
1. Overview ................... 25
2. Real Parties in Interest ........... 26
C. Substantial Justification Defense ......... 29
1. Identifying “the Position of the
United States in the Proceeding” ....... 29
2. Substantial Justification Analysis ...... 31
D. Conclusion .................... 33
III. Amount of Award .................... 33
A. Respondent’s Position ............... 33
B. Applicability of Statutory Rate Cap ........ 33
1. Limited Availability of Qualified Attorneys . 34
2. Local Availability of Tax Expertise ..... 36
3. Difficulty of the Issues ........... 36
4. Other Possible Special Factors ....... 37
a. In General ............... 37
b. The Government’s Misconduct ...... 38
c. The Delay Factor ............ 41
d. Test Case Status ............ 44
5. Conclusion .................. 45
C. Compensable Hours ................. 45
1. Respondent’s Objections ........... 45
a. Duplicative Fees Due to Change of
Counsel ................. 45
b. Overstaffing .............. 46
c. Porter & Hedges Client Conferences ... 48
2. Additional Adjustments to Time Claimed for the
Appeals ................... 49
a. Missing Minns Time Entries ....... 49
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Last modified: May 25, 2011